The Supreme Court has set aside the National Company Law Appellate Tribunal’s (NCLAT) order against the approval of Dhanuka Laboratories’ resolution plan for the debt-ridden Chennai-based Orchid Pharma.
The SC order in the case filed by the State Bank of India paves the way for the takeover of Orchid by Dhanuka Laboratories, whose resolution plan was approved by the Chennai bench of the National Company Law Tribunal (NCLT) in June 2019.
Orchid informed the exchanges about the apex court’s order on Tuesday.
The SC’s division bench comprising Justice Rohinton Fali Nariman and Justice S. Ravindra Bhat said NCLAT’s order had to be set aside in view of a recent judgment, where it was categorically held that no provision in the Insolvency and Bankruptcy Code or regulations have been brought to the court’s notice under which the bid by any resolution applicant has to match the liquidation value arrived at in the manner provided in the relevant regulations.
“Accordingly, the appeal is allowed and the judgment of the NCLAT is set aside,” the order said. Orchid Pharma owes about ₹3,200 crore to a total of 24 banks. Orchid figured in RBI’s second list that had the names of 28 large defaulters.